Venture Capital Brands in the Digital Age

A venture capital firm’s reputation and by extension its brand is shaped and defined by a few critical components including: (i) The Entrepreneurs (the stature and profile of the entrepreneurs that the firm has backed); (ii) The Companies (the successful companies in which the firm has invested); and (iii) the Partners (their industry and entrepreneurial experience along with their knowledge and value add they bring to portfolio companies). Strong venture capital brands attract the best entrepreneurs who then build the best companies which creates a virtuous cycle for the venture capital firm and it’s brand. Read more>>

The Top of the Public Internet Pyramid

There is a very interesting article on Venturebeat by Glenn Solomon with a great graphic produced by Cowen and Company that separates public Internet companies by growth and profitability (see below). 

Essentially it shows that there are very few companies growing revenue at over 30% per year that also have greater than 30% EBITDA margins and the 6 companies that fit in this category are all outside the US (Russia, China and Latin America).  One of these companies, Yandex, was a company we invested in 11 years ago when the company raised its Series A round.  Today it is the largest search engine in Russia and completed its IPO in June at an $8 billion valuation.

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The Return of the Internet IPO

Zillow priced their IPO yesterday and began trading today. Zillow increased their pricing range during their roadshow and then priced above the range at $20 per share and ended the day at $35.77 per share (valuing the company at $540 million when they priced and closing the day at $960 million). This is a great start for the first Internet company with run-rate revenues of less than $50 million to go public in a long time (with the exception of Jiayuan (NASDAQ: DATE) which did go public with a $50 million run rate but likely was able to price successfully due to its Chinese market focus). I remember the first IPO of a company I had invested in 1997. The company was Andover.Net (NASDAQ: ANDN), it went public in late 1999 with $5 million in revenue (it priced its IPO at $270 million). It is interesting to compare the relative revenue multiples of these, the company from the first Internet wave valued at 54x revenue, the second company from the current Internet IPO wave priced its IPO at 12x revenue. Read more>>

The Implications of the Global Web for US Startups

It is extraordinary to think about the recent events in Egypt and the catalyzing impact of both Facebook and Twitter. Not only is it amazing to see people organizing and communicating through new methods on mobile devices, but these services are delivered by companies in the US that are less than a decade old. Read more>>

The Liberal Arts Entrepreneur

Last week was proclaimed as National Entrepreneur Week by our President and Friday, November 19th, was National Entrepreneurs’ Day. When I read this, I asked myself the question “So, where do you go to school to become an entrepreneur?”
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June is Innovation Month in New England – A Look at The Mobile Sector

I was reading Scott Kirsner’s recent article Innovation Month: What’s It To You and when I read his request for bloggers to “write a post about some initiative, dynamic or group that you feel is vital to innovation in the region” it reminded me of a presentation I gave a few weeks back to the 128 Innovation Capital Group specifically on a sector in our region that is driving innovation and real value. The title of my presentation was “Mobile Innovation in Boston / New England, Entrepreneurial Opportunities for the Future” Read more>>

PE Hub “Shindig” – The Boston Venture Community feels Alive!

I attended the PE Hub Shindig last night which was organized and led by the well known Dan Primack and sponsored by .406 Ventures, Second Market, Atlas Ventures, Capital Dynamics and Velocity Financial. I had to take a rather circuitous route into Boston because half of the east / west roads around Boston have been flooded out so I showed up a little late.

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The Next Generation of E-commerce innovation – East Coast Leadership & Success

With all the talk of the coming tech IPOs and the inclusion of Gilt on most of these lists, I was prompted to reflect on the ecommerce sector on the East Coast. Many of the mega success stories of ecommerce over the past decade are on the West Coast, including such notable pioneers as Amazon, eBay andNetflix. What I find incredibly interesting, however, is the number of big and successful ecommerce companies located in the Northeast. Priceline, Vistaprint, and others were conceived, started and grown by talented East Coast entrepreneurs into multi-billion dollar market leaders. Read more>>

Internet Subscription Services / Growing Opportunities in the Recession

I recently attended the very informative and expansive McGraw Hill Media Conference and there was a lot of discussion about the challenges facing the advertising market (both traditional and digital). Certainly there is a secular shift afoot from traditional to digital media and the time spent on digital media relative to the ad dollars flowing there are mismatched. There are many reasons for this that I won’t delve into and I firmly believe the secular shift will continue growing digital media into a much larger industry than it is today. However, one area that I continue to be intrigued by is the subscription model where the consumer pays for the value they derive from spending time with a digital media solution (rather than paying for it by watching ads).

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Communications Infrastructure – New England Leadership and Success

We all know that The Red Sox, The Patriots, and The Celtics are examples of successful leadership that has arisen from New England, but another New England super star is its Communications Infrastructure sector. The New England entrepreneurial ecosystem has long been identified with communications equipment, storage, life sciences and software. However, a somewhat less visible, but equally robust segment of our innovation fabric is the Communications Infrastructure cluster. These are the companies that build, own and operate the critical communications network infrastructure that enable today’s modern Internet, voice and mobile communications services. These are companies operating everything from wireless towers to cable systems to telephone / data networks to CDNs (content delivery networks). Read more>>